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Gazprom Neft moves into monetising E&P technologies

Gazprom Neft has become one of the first companies in Russia’s oil and gas industry to launch a business model for monetising technology. This new subsidiary, Gazpromneft — Technology Partnerships, will focus on developing integrated solutions for ensuring commercial viability on “hard-to-recover” oil-production projects, and on selling innovative developments within this industry-specific market.

In establishing this new business model and expanding its project portfolio, the Bazhenov Technology Centre has been renamed the Gazpromneft — Technology Partnerships Centre for Industrial Integration (a subsidiary of Gazprom Neft). This enterprise will continue to implement the national project on developing technologies for the viable development of the Bazhenov Formation, as operator.* Gazpromneft — Technology Partnerships will also become a centre of expertise in managing Gazprom Neft’s strategic reserves categories, including “unconventional”, “Paleozoic”, and “Achimovsky formation” reserves, as well as chemical enhanced oil recovery (EOR) methodologies.

All of the above are currently in development, and — subject to commercially-viable solutions being found — will give the company access to a colossal resource base. The Centre for Industrial Integration will be involved in developing systematic approaches and managerial and technological tools for implementing each of these projects. Once established, and once their effectiveness has been confirmed, new business models will be rolled out to other Gazprom Neft subsidiaries.

Monetising E&P technologies will be a key area of the Centre’s activities, and Gazprom Neft has collated a portfolio of the company’s most promising products for sale on the external market. These include cognitive technologies, geological prospecting technologies, chemical EOR techniques, high-tech fracking, and more.

Pilot projects expected to be launched on the specialist industry market as soon as 2020 include the CyberFracking 2.0 simulator,** and micro-seismic monitoring software. The company ultimately plans to monetise a significant proportion of its technology portfolio. Gazpromneft — Technology Partnerships’ activities will be supervised by Alexei Vashkevich, who will continue to head the company’s Science and Technology Centre.

“We are convinced that the future of the oil and gas industry is inextricably linked to developing technology. We have our own proprietary developments, whose effectiveness has been proved under actual field conditions. Assessments by industry specialists both in Russia and abroad also testify to these developments being of interest to the market. In order to develop our own solutions, we will be approaching every technology project with a view to monetising it, so that we ultimately offer products that accommodate user requirements as far as possible.”
Vadim Yakovlev
Vadim Yakovlev Deputy CEO for Exploration and Production, Gazprom Neft
“Monetisation is a process whereby any product the company makes is turned into a marketable one, creating added value. Our objective isn’t just making money from selling technologies. An equally important element is to qualitatively change our technological development, and to accelerate this. Commercial products develop significantly faster in response to client needs. The databases for these are considerably more extensive, which means they can ‘learn’ faster when it comes to artificial intelligence. We will continue to develop some new solutions in partnerships, gaining access to other players’ market knowledge. One should also bear in mind that manufacturability is one of the more important criteria in choosing a partner: first and foremost, you have to take into account those companies whose solutions are already well known on the market, and who can make the greatest contribution — in terms of technology — overall. This is precisely the sort of partner we want to bear us in mind — not just in terms of Russian industry, but internationally. Monetisation, and taking our solutions to market, will also help with this.”
Alexey Vashkevich
Alexey Vashkevich Director for Technological Development, Gazprom Neft
“A methodology for working with projects that have to be made cost-effective was developed during work on developing the Bazhenov Formation. The principles we put forward for putting commercial cases together — including, specifically, putting partnerships in place, monetising technologies, and working through technological test sites — helped achieve good intermediate outcomes: the project came close to developing a commercial technology for working with hard-to-recover reserves, with potential profitability of RUB8,500 per tonne. All of which meant we could look at other complex company projects in terms of being a systemic technological challenge that our experience could prove useful in overcoming.”
Kirill Strizhnev
Kirill Strizhnev Director General, Gazpromneft — Technology Partnerships
Notes for editors

* The Bazhenov Formation comprises a group of oil-bearing rocks covering an area of approximately one million square kilometres in Western Siberia. The formation lies at a depth of two to three kilometres. Provisional forecasts indicate geological reserves at the Bazhenov Formation to be in the order of 18 to 60 billion tonnes. There are not, currently, any effective technologies for working with the Bazhenov Formation.

** The Cyber-Fracking 2.0 simulator was developed by the Gazprom Neft Science and Technology Centre as part of a consortium including the Moscow Institute of Physics and Technology (MIPT), Skoltech, the St Petersburg Polytechnic University, and the Institute of Hydrodynamics. A commercial version of this digital tool — designed to improve fracking quality to increase well inflow — has been released.

The programme covers various types of fracking — i.e., for traditional and hard-to-recover reserves — and takes various types of wells into account. The uniqueness of this development lies in its mathematical algorithms, which make it possible to select the right combination of fracking specifications for strata injection, as well as ensuring optimum efficiency in operating under different conditions.